Surging energy prices amid the Iran war are worrying Wall Street, but UBS warned that higher food costs could follow. Since the start of the conflict in the Middle East, international Brent crude futures have surged 50%, while West Texas Intermediate futures have gained 66%. UBS economist Arend Kapteyn said the energy jump is subsequently pushing up fertilizer costs, particularly with the Strait of Hormuz being a key passage for the transport of components like urea and ammonia. When fertilizers become more expensive, costs can get passed down to food buyers, the economist said. “Rising energy prices are spilling over into fertilizer markets, which in turn is a key driver of global food prices,” Kapteyn wrote in a note to clients late last month. He said supply chain risks were “amplified” by the disruption to production of natural gas, which accounts for 60% to 80% over overall fertilizer costs. Last month, Qatar’s Ras Laffan Industrial City , home to the world’s largest liquefied natural gas export facility, was the target of Iranian missile attacks. With recent energy price hikes, Kapteyn said to expect fertilizer prices to rise 48% year over year, up from the current run rate of about 32%. In turn, global food prices could grow 12% year over year, the economist found. Kapteyn said advanced economies could see an additional 50 basis points of inflation as a result. Emerging markets, on the other hand, would experience additional inflation of up to 240 basis points. “These are first-round effects only … but absent moderation in energy prices, the food price shock in EM could rival the energy shock,” Kapteyn wrote, using an acronym for emerging markets.